ATTORNEY NEWSLETTER
Agents Target Seniors For Annuity Purchases
The Primary Disadvantages Of Annuities For Seniors
Check With Tax Advisor And Get A Second Opinion
Evans Law Firm, Inc. recommends seniors avoid certain types of deferred annuities because deferred annuity contracts can be expensive and complicated and tie up a senior’s money for years. Often, insurance agents out to make sales claims to be “retirement planners” or advisors and host seminars and consultation sessions which may turn into sales presentations not neutral advice with regards to retirement planning. Any high-pressure or deceptive sales tactics and sales of unsuitable annuities violate the law and constitute financial elder abuse when the targeted consumer is a senior. Cal. Welf. & Inst. Code § 15610.30 (definition of financial elder abuse); Cal. Ins. §§ 790 et seq. (Unfair Insurance Practices Act) and 10509 (suitability requirement). Senior victims may be entitled to damages and an award of attorneys’ fees and expenses for bringing a case. Cal. Welf. & Inst. Code § 15657.5. If you are over 60, live in Santa Clara County, or elsewhere in California and own a deferred annuity (such as a fixed indexed annuity), call us today at 415-441-8669 (or toll free at 1-888-50EVANS) for a free review of your policy.
Primary Disadvantages of Annuities
Cost. Annuity premiums have embedded fees. The fees lower the long-term returns so that an annuity may not be as profitable as other options such as saving and investing.
Illiquid asset. Deferred annuities impose penalties on withdrawals from the policy during the period known as the surrender period. The surrender period may last ten or more years, and the surrender charge may be as high as 15%. Once you annuitize, you cannot change the terms of the income payments. It is possible to sell or surrender an annuity, but you’ll lose some of your invested principal in the process.
Complexity. Annuities can be complicated. It can be hard to understand what you’re getting for your premiums. Complicated formulas for calculating your return and caps and participation rates all work in the carrier’s favor, not yours.
Taxable income payments. If you purchase an annuity with pre-tax funds, any withdrawals from your annuity are fully taxable at ordinary income tax rates. If you purchase an annuity with after-tax funds, withdrawals are partially taxable. Always consult your tax advisor before making any transactions involving annuities, whether it’s a purchase, surrender, or exchange.
Contact Us
If you are over 60 and live in Santa Clara County or elsewhere in the State of California and have an indexed annuity, we can review your contract for free. You can reach Ingrid M. Evans at Evans Law Firm, Inc. at (415) 441-8669, or toll free at 1-888-50EVANS or by email at <a href=”mailto:info@evanslaw.com”>info@evanslaw.com</a>.
Some significant issuers and distributors of fixed, variable and fixed indexed deferred annuities in California are listed below. We are not in any way suggesting that any of these carriers or distributors has done anything wrong. The list is provided solely as a reference for our readers.
AIG/American General Life Insurance Company
Allianz Life Insurance Company of North America
American Equity Investment Life Insurance Company
American General Life Insurance Company/AIG
American International Group, Inc. (AIG)
American National Life Insurance Company
Athene Annuity & Life Assurance Company
Athene Annuity and Life Company
Athene USA
Aviva Life Insurance Company
AXA Equitable Financial Services, LLC
AXA Equitable Life Insurance Company/AXA US
AXA Advisors, LLC
Brighthouse Financial, Inc./MetLife
EquiTrust Life Insurance Company
Fidelity & Guaranty Life Insurance Company
Genworth Financial, Inc.
Genworth Life and Annuity Insurance Company
Genworth Life Insurance Company
Guggenheim Partners, LLC
Guggenheim Partners/Security Benefit Life Insurance Company
ING USA Annuity and Life Insurance Company
Jackson National Life Insurance Company
John Hancock Life Insurance Company
Lincoln Benefit Life Company
Lincoln Financial Group
Massachusetts Mutual Life Insurance Company
Metlife/Metropolitan Life Insurance Company/Brighthouse Financial, Inc.
Minnesota Life Insurance Company
Nationwide Investor Services Corporation (NISC)
Nationwide Life and Annuity Insurance Company
Nationwide Life Insurance Company
New York Life Insurance Company
Northwestern Mutual Investment Services, LLC
Northwestern Mutual Life Insurance Company
Northwestern Mutual Wealth Management Company
Pacific Life & Annuity Company
Pacific Life Insurance Company
PacLife
Security Benefit Corporation
Security Benefit Group, Inc.
Security Benefit Life Insurance Company/Guggenheim Partners
Security Investors, LLC
Security of Denver Life Insurance Company/Voya
Transamerica Life Insurance Company
Voya Financial Advisors
Voya/Reliastar Life Insurance Company
World Financial Group Insurance Agency, Inc.
